Ready to begin your journey to becoming a top-producing REO agent? You’ve made a great choice – REO is a tremendous career path full of opportunities, and many agents have made millions in this niche, while many more use it as down-market spoke of income to maintain profitability during times of economic hardship.
Before you begin, please read this entire article carefully, and work on collecting all of the information that you’ll be required to have, including:
- Copy Of Your Brokers License
- Copy Of Your Real Estate License
- Errors & Omissions Insurance
- W-9 Form
- Errors & Omission Insurance
- General Liability Insurance
- List Of Your Preferred ZIP Codes
- Your REO Resume
Don’t worry, all of the required information is described in detail below, and we’re going to provide with everything you need to create your REO industry resume & apply with leading REO & BPO companies in our training portal.
Getting the Basics Covered: How to get started as a REO Agent
Most banks and asset management companies have similar requirements for their REO agents. Below is a brief description of each:
Broker License: A current copy of the broker’s license will be required to work with any bank or asset management (AM) company. Make sure you have the permission of your broker when applying as an REO agent. If they’re reluctant to have you enter the REO arena, you may have to explain they have no work to do…only collect a paycheck. If they’re still reluctant to “allow” you to apply as an REO agent you can always look for a more supportive broker.
Real Estate License: A current copy of your real estate license will also be required. Make sure to have this (and all your application documents) in pdf format in one specific file on your computer for easy access.
Errors & Omission Insurance (E&O): Make sure to check with your broker and confirm the amount of E&O insurance your firm currently has. Most banks and AM companies will require at least $1,000,000 of E&O insurance. NOTE: If you’re going to work under your own broker license you MUST have E&O insurance before an REO company will hire you. Rates are competitive, so check with several companies that provide E&O coverage. Your local board may also have a discount agreement with a particular E&O company. I use Black Ink Insurance Broker. There phone number is 916-774-0996. I spend about $4,500 per year for coverage of about $30 million in real estate sales.
General Liability Insurance (GL): Most REO companies will also require GL insurance. Again, if you’re working with a broker confirm the amount of GL insurance coverage that you have. $2,000,000 in coverage is an average requirement for most REO companies. This insurance is not expensive, so don’t let this deter you if working under your own broker license. As with E&O insurance you’re local board may also have a discount for GL insurance with a particular company.
Zip Codes: Most every REO company assigns REO properties by zip code. Make sure to create a list of the zip codes you want to cover. If you want the best chance to receive REO assignments include as many zip codes as you can on the REO company application.
Go to https://www.zip-codes.com/zip-code-radius-finder.asp which is a website that will help you identify all the zip codes within a radius from a specific zip code. You should find all zip codes that are 5 miles and 10 miles from your main address.
NOTE: Make sure to save a copy of all the zip codes you cover (separated by commas) in a word document with the rest of your REO application documents. This way you can cut and paste the zip code list each time you complete a new application. In addition to the zip codes you cover, the office address which you use on the REO application will be extremely important. If you’re real estate office is located in a commercial area, and you’re home office is located in a more residential area, you may want to consider using your home address on the application. The REO companies will consider the zip codes in your list, but the proximity of the REO property to the address you have on file will be THE most important factor in getting assignments.
Cities: Some REO companies will ask for the cities you cover on the REO application as well as the zip codes. Although most companies assign property by the location of your office and zip code, don’t leave this out if asked for the cities you cover. NOTE: in personal conversations with asset managers they’re most likely to ask about the cities you cover and not zip codes.
Resume: Although not all REO companies will ask for a resume on their application it’s extremely important to have a resume completed. If you currently have no REO experience DON’T LET THIS STOP YOU! Everyone has to start at the beginning. We’ll be covering creating the perfect REO resume in the class soon. You can also find several excellent examples of REO resumes in the member learning portal. We can also review your resume for you.
Sign up for dropbox to help keep everything organized. Dropbox is a FREE website that allows you to share files between computers and team members. The greatest benefit is the files are both stored locally and in the “cloud.” This allows you to upload pictures directly from your computer into equator, res.net or any other client platform. Also, all your team members can have access to the shared files.
Basic Sales Numbers: You are going to need some basic sales numbers, like how many REOs have you sold in the past year? How many BPOs have you completed? What is your average days on market? If you don’t have sales numbers already, use your broker’s sales numbers.
In summary, make sure to have all the information ready when applying with REO companies. The more organized this information is, the faster you can submit REO applications.
Learn more about this topic in the member learning portal >>
